In response to the U.S. Army’s need to increase the firepower of the M1126 Stryker IFV, the Army launched a modernization program in 2015. This program involved installing an unmanned turret with a 30 mm automatic cannon. This variant bridges the gap between the standard M1126 Stryker, which has a 12.7mm machine gun, and the M1128 Stryker MGS, which has a 105mm gun. The upgrade covered 81 vehicles of the 2nd Cavalry Regiment stationed in Germany. General Dynamics Land Systems developed the upgrade in cooperation with Kongsberg Protech Systems and Northrop Grumman. Following successful trials, including live-fire tests and tactical exercises in Germany, the vehicle received the official designation M1296 Infantry Carrier Vehicle — Dragoon (ICV-D). The first production batch entered service in December 2017, and the last entered service in late 2018. As of 2024, the M1296 Dragoon remains in service with the unit; however, the U.S. Army plans to replace it with the M1304 ICVVA1-30mm variant starting in early 2025.

The M1296 was introduced in Update 2.55 "Ninth Wave". The wheeled Dragoon is based on the familiar Stryker chassis and offers excellent mobility and a wide range of tactics, from capturing points to executing surprise flanking maneuvers. Its key difference from the Stryker MGS is its armament: a 30mm Bushmaster II autocannon with a high rate of fire and an APFSDS belt. Drawbacks include the vehicle’s large size, light armor, small crew of three, and lack of ATGMs for dealing with more heavily armored targets.